Rep. Panetta Reintroduces First-Time Homebuyer Tax Credit to Help More Americans Achieve Homeownership
Monterey, CA – United States Representative Jimmy Panetta (CA-19) authored and reintroduced the First-Time Homebuyer Tax Credit Act, a bicameral bill which would help working families afford their first home. The legislation, co-led in the House by Rep. Mike Thompson (CA‑04), would create a refundable tax credit of up to 10 percent of a home’s purchase price, capped at $15,000, for qualified first-time buyers. Senators Sheldon Whitehouse (D‑RI) and Martin Heinrich (D‑NM) have introduced companion legislation in the Senate.
High housing costs and interest rates are shutting families out of homeownership across the country. According to the Harvard Joint Center for Housing Studies, the median home price in the U.S. climbed to over $441,000 in 2025. Mortgage rates remain elevated near 6.93 percent, and first-time buyers now represent just 24 percent of all homebuyers, the lowest share in over four decades. The median age of a first-time buyer is now 38, up from 29 in 1981.
California continues to be among the least affordable states for homeownership. In the first quarter of 2025, only 17 percent of California households could afford a median-priced single-family home, less than one-third of the affordability peak seen in 2012. A typical home in the state costs $846,830 and requires a minimum qualifying income of $218,000. Monthly payments, including taxes and insurance, average $5,450.
“The affordability issue is hitting all of us in one way or the other and the lack of affordable housing is a cornerstone of that problem,” said Rep. Panetta. “Our legislation would target that issue by providing qualifying first-time homebuyers with a $15,000 tax credit toward the purchase of a new home. The First-Time Homebuyer Tax Credit Act is a practical and essential step toward addressing housing affordability by incentivizing and investing in the American Dream of home ownership.”
California’s 19th Congressional District faces some of the steepest barriers to homeownership. In Q1 2025, just 10 percent of households in Monterey County and 11 percent in San Luis Obispo County could afford a median-priced home, which costs $932,000 and $955,480 respectively. Santa Cruz County saw a slight improvement, with 15 percent affordability, but median home prices there reached $1.3 million. In Santa Clara County, only 18 percent of households could afford a home, which had a median price of $2.02 million and required an annual income of at least $520,000.
“Our housing crisis is simply unsustainable,” said Rep. Thompson. “Only seventeen percent of Californian families can afford to purchase a median-priced home. Low- and middle-income Americans are being priced out of homeownership and with it, they are being locked out of the American dream. It’s well past time Congress help level the playing field. I’m glad to work with Representative Panetta and Senators Heinrich and Whitehouse to introduce the First Time Homebuyer Tax Credit Act of 2025 to promote housing stability and help every American build generational wealth.”
“Owning a home is at the core of the American dream, but too many young families have been priced out of homeownership in recent years because of the housing supply crunch. And Trump’s chaotic tariff regime has increased homebuilding costs, forcing developers to pause construction on much-needed new units,” said Senator Whitehouse. “Our tax credit for first-time homebuyers would help make the American dream a reality for more of the young Americans left behind in Trump’s billionaire-first economy.”
“Buying your first home is more than just owning property: It’s a source of pride, stability, and hope for the future. Unfortunately, buying a home is out of reach for many families right now. We’re changing that with my First-Time Homebuyer Tax Credit Act,” said Senator Heinrich. “I’m proud to reintroduce this bill to ease the financial burden on aspiring homeowners and give every working family an equal opportunity to realize the American dream of owning a home.”
Under the bill, qualifying taxpayers could receive the credit at closing through their lender or elect to treat the purchase as occurring in the prior tax year to receive the credit in advance. The credit phases out for households earning more than 150 percent of the area median income or for homes purchased above 110 percent of the area’s median price. It is limited to homes financed with federally backed mortgages.
The legislation has been widely endorsed by housing advocates and local industry leaders. Endorsements include; National Association of REALTORS (NAR), the National Association of Home Builders (NAHB), the Mortgage Bankers Association, the Santa Clara County REALTORS, Santa Cruz County REALTORS and the Monterey County REALTORS, the Rhode Island State Department of Housing, the Rhode Island Association of REALTORS, RIHousing, the Housing Network of Rhode Island, HousingWorksRI, the Rhode Island Builders Association, and the Rhode Island Mortgage Bankers Association.
“Homeownership remains one of the most powerful tools for building generational wealth, yet for too many working families, it’s become a distant dream. Congressman Panetta’s First-Time Homebuyer Tax Credit Act is a targeted, timely step toward restoring economic mobility and expanding access to that dream,” said Debora Sanders, 2025 President, MCAR. “By easing the financial burden for first-time buyers, this legislation empowers communities, strengthens families, and brings the promise of homeownership back within reach.”
Homeownership remains out of reach for too many first-time buyers, especially in high-cost areas like ours. The First-Time Homebuyer Tax Credit Act is a smart, practical solution that provides real support to help more families achieve the dream of owning a home,” said Doug Goss, 2025 President, Santa Clara County Association of REALTORS. “We appreciate Congressman Panetta’s leadership on this issue and are proud to support this important legislation.”
“Supporting first-time homebuyers goes beyond signing contracts and handing over keys, it means pushing for policies that make homeownership truly attainable,” said Renee Mello, 2025 President, Santa Cruz County Association of REALTORS. “The First-Time Homebuyer Tax Credit Act is a long-overdue step toward giving every aspiring homeowner a fair chance at achieving their dream.”
Original cosponsors in the House of Representatives include; Reps. Eleanor Holmes Norton (DC-AL), Greg Landsman (OH-01), Shri Thanedar (MI-13), Janelle Bynum (OR-05), Terri Sewell (AL-07), Troy Carter (LA-02), Cleo Fields (LA-06), Raja Krishnamoorthi (IL-08), Angie Craig (MN-02), Jill Tokuda (HI-02), Darren Soto (FL-09), Thomas Suozzi (NY-03), Hillary Scholten (MI-03), April McClain Delaney (MD-06), Derek Tran (CA-45), Donald Davis (NC-01), Eugene Simon Vindman (VA-07), Julia Brownley (CA-26), Julie Johnson (TX-32), Jonathan Jackson (IL-01), Steve Cohen (TN-09), Danny Davis (IL-07), and Shomari Figures (AL-02).
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